OTAs showed a welcome recovery in 2021, supported by continued strength in domestic travel. After ending 2020 down 58%, US OTA bookings nearly doubled despite the ups and downs of another pandemic year. According to Phocuswright’s latest travel research report on the U.S. Online Travel Agency Market Report 2021-2025 segment, OTAs generated $65.2 billion in gross bookings in 2021, reaching 82 % of pre-pandemic levels (2019).
Three key developments in the US OTA market:
Full service is no longer alone
Expedia has long offered a near-full range of travel products through its flagship site Expedia.com, allowing customers to book multiple products for one trip, while its US competitors have shifted heavily towards a single product line.
Booking.com and HotelTonight have been anchored in accommodation, Hopper and CheapOair in flights. However, both Booking.com and Hopper have made great strides in expanding into full-service OTAs, putting further pressure on Expedia.
Money talks: sales, acquisitions and investments
2021 has been a year for OTAs to review portfolios and reduce or supplement their offerings. For Expedia Group, the goal was to simplify operations to operate more effectively as a family of brands and to invest in businesses where they are best positioned to win.
Conversely, Booking Holdings opened its portfolio by spending more than $3 billion on acquisitions and investments in 2021.
Hopper, which plays on a much smaller scale compared to Expedia and Booking but has big ambitions, has also joined the acquisition game, while raising $345 million in 2021 between its Series F of March and Series G of August.
Visits, activities & attractions: the remix
Not so long ago, the Tours, Activities and Attractions segment was seen as the next big source of growth in the travel industry. The category flourished in 2018, and OTA giants, including Booking and Expedia, vied for position as leaders.
Since then, both OTAs have changed their approach to offering activities. Rather than sourcing directly, Expedia and Booking have largely turned to partnerships with activity-based travel agencies. While changes were already in play before the pandemic, OTAs have further strengthened the partnership approach in 2021.
Hopper, on the other hand, entered the space with its acquisition of PlacePass. PlacePass was most notable as a power source for Marriott’s tours and activities booking platform, which Hopper will now power.
OTAs continue to regain share of the total online market during the 2021 travel recovery. However, it is important for travel agencies to be aware that supplier websites have retained their majority stake in the US online travel market. with a 63% share of gross online bookings. This report helps companies understand how providers and OTAs compete, differentiate and deliver new value to travellers. The United States Online Travel Agency Market Report 2021-2025 by Phocuswright provides a comprehensive view of the United States OTA landscape, including detailed market size and projections, distribution trends, key developments and Moreover.
For more information for you and your entire business, subscribe to Phocuswright Open Access. This subscription puts the entire Phocuswright research library and powerful data visualization tools at your fingertips. There’s a reason leaders around the world trust and reference Phocuswright’s research and data on a daily basis. See the benefits here.
ABOUT PHOCUSWRIGHT INC.
Phocuswright is the travel industry’s research authority on how travelers, suppliers and intermediaries connect. Independent, rigorous and impartial, Phocuswright promotes intelligent strategic planning, tactical decision-making and organizational effectiveness.
Phocuswright offers qualitative and quantitative research on the changing dynamics that influence the distribution of travel, tourism and hospitality. Our market intelligence is the industry standard for segmentation, sizing, forecasting, trends, analysis and consumer travel planning behavior. Every day around the world, senior executives, marketers, strategists, and research professionals from every segment of the industry value chain use Phocuswright research for competitive advantage.
To complement its primary research in North and Latin America, Europe and Asia, Phocuswright produces several high profile conferences in the United States and Europe, and partners with conferences in China, Singapore and the United Arab Emirates. . Industry leaders and business analysts bring this intelligence to life by debating issues, sharing ideas, and defining the ever-changing reality of travel commerce.
The company is headquartered in the United States with Asia-Pacific operations based in India and local analysts across five continents.
Phocuswright is a wholly owned subsidiary of Northstar Travel Media, LLC. (116 32nd Street, 14th Floor, New York, NY 10001 USA). www.phocuswright.com
ABOUT NORTHSTAR TRAVEL GROUP
Northstar Travel Group is the leading provider of business-to-business news, information, data, transactions and personalized content solutions for the travel, meetings and hospitality industries. Brands under the Northstar umbrella include Travel Weekly, Travel Weekly China, Travel Weekly Asia, TravelAge West, Business Travel News, Phocuswright, Meetings & Conventions, M&C China, Web in Travel and Inntopia. Northstar is the industry leader in marketing solutions, personalized content communications, content licensing and database management serving the travel and meetings industries. The company produces more than 52 face-to-face events, which take place in North and South America, Europe, Asia and the Middle East. Northstar is based in Secaucus, NJ, and is a portfolio company of EagleTree Capital. www.northstartravelgroup.com