Table of Contents
Executive Summary
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- The market
- Online takes the lion’s share of holiday bookings
- OTAs the leading single booking channel
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- Figure 1: Estimated number of people who booked a holiday online, by channel, 2017
- Holiday planning cycle remains consistent
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- Figure 2: Consumer plans to book a holiday within the next three months, June 2012-March 2018
- Income squeeze abates as wage growth overtakes inflation
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- Figure 3: Average wage growth and consumer price inflation, March 2014-March 2018
- OTA usage remains stable
- Monarch collapse prompts investigation into traveller protections
- Digital assistants increasing presence in the home
- Social competes for space in the booking process…
- …but search is better placed to serve holidaymakers
- The travel app economy continues to grow
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- Figure 4: Total downloads in the UK for apps in the Travel category on the iOS App Store and the Travel & Local category on Google Play combined, 2015-17
- Figure 5: Total time spent in the Travel & Local category on Android* phones in the UK, 2015-17
- Figure 6: Total sessions in apps in the Travel & Local category on Android* phones in the UK, 2015-17
- Companies and brands
- Booking.com increases penetration in the OTA market
- Expedia group second-largest supplier of OTA services
- TripAdvisor expands its reach as an OTA
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- Figure 7: Market penetration of travel comparison websites/apps, based on online holiday booking behaviour in the last 12 months, April 2018
- Travellers embrace OTA apps
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- Figure 8: Ranking of top OTA apps according to average monthly active users on iPhone and Android phones in the UK, 2017
- Expedia adds concert tickets to its platform
- Customers get more transparency from a Holiday Value Index tool
- Facebook advertising targets those considering travel
- Trivago continues to dominate advertising spend
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- Figure 9: Total above-the-line, online display and direct mail advertising expenditure on online travel/booking agents, by advertiser, 2017
- The consumer
- Online remains most popular booking channel
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- Figure 10: Ways in which consumers booked their holidays in the last 12 months, April 2018
- Converting research into bookings
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- Figure 11: Providers used to research and book holidays online in the last 12 months, April 2018
- OTAs a popular option for short-haul trips
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- Figure 12: Type of holiday most recently booked via travel comparison websites/apps, April 2018
- At least 48% of holidays abroad are not ATOL protected
- Accommodation-only bookings reserved for UK trips
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- Figure 13: Services booked via travel comparison websites/apps for the most recent holiday, by type of holiday booked, April 2018
- Laptops and desktops remain the preferred option for holiday bookings
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- Figure 14: Devices used for research and booking holidays via travel comparison websites/apps, April 2018
- Consumers compare their comparison sites
- Consumers receptive to reward schemes
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- Figure 15: Consumer behaviour related to travel comparison sites/apps, April 2018
- Protections available to holidaymakers
- Chatbots may change the holiday booking process
- An activity-first search appeals to over half of consumers
- Travellers are engaged in the holiday planning process
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- Figure 16: Attitudes towards holiday planning and booking processes, April 2018
- Consumers still perceive OTAs as better value than traditional travel agents
- Piecemeal booking styles seems here to stay
- What we think
Issues and Insights
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- Increasing OTA access points
- The facts
- The implications
- Increasing loyalty in OTAs
- The facts
- The implications
The Market – What You Need to Know
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- Online takes the lion’s share of holiday bookings
- OTAs the leading single booking channel
- Holiday planning cycle remains consistent
- Income squeeze abates as wage growth overtakes inflation
- OTA usage remains steady but tour operator use spikes
- Monarch collapse prompts investigation into traveller protections
- Digital assistants increasing presence in the home
- Social competes for space in the booking process
- Search is better placed to serve holidaymakers
- The travel app economy continues to grow
Market Size and Segmentation
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- Online takes the lion’s share of holiday bookings
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- Figure 17: Estimated number of people who booked a holiday, 2017
- OTAs the leading single booking channel
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- Figure 18: Estimated number of people who booked a holiday online, by channel, 2017
Market Background and Drivers
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- Holiday planning cycle remains consistent
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- Figure 19: Consumer plans to book a holiday within the next three months, June 2012-March 2018
- Income squeeze abates as wage growth overtakes inflation
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- Figure 20: Average wage growth and consumer price inflation, March 2014-March 2018
- OTA usage remains steady but tour operator use spikes
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- Figure 21: Websites/apps used to book holiday, 2015-18
- CMA investigates OTA selling practices
- Monarch collapse prompts investigation into traveller protections
- Digital assistants increasing presence in the home
- Social competes for space in the booking process…
- …but search is better placed to serve holidaymakers
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- Figure 22: Google’s integrated hotel booking option in search
- The travel app economy continues to grow
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- Figure 23: Total downloads in the UK for apps in the Travel category on the iOS App Store and the Travel & Local category on Google Play combined, 2015-17
- Figure 24: Total time spent in the Travel & Local category on Android* phones in the UK, 2015-17
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- Figure 25: Total sessions in apps in the Travel & Local category on Android* phones in the UK, 2015-17
- Airline and direct booking apps competing with OTAs
Companies and Brands – What You Need to Know
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- Booking has highest penetration in the OTA market
- Expedia Group second-largest supplier of OTA services
- TripAdvisor expands its reach
- Travellers embrace OTA apps
- Expedia adds concert tickets to its platform
- Expedia offers Holiday Value Index tool
- Thomas Cook announces strategic alliance with Expedia
- TripAdvisor launches Sponsored Placements
- Trivago continues to dominate advertising spend
Market Share
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- Booking.com increases penetration in the OTA market
- Expedia group second-largest supplier of OTA services
- TripAdvisor expands its reach as an OTA
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- Figure 26: Market penetration of travel comparison websites/apps, based on online holiday booking behaviour in the last 12 months, April 2018
- Travellers embrace OTA apps
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- Figure 27: Ranking of top OTA apps according to average monthly active users on iPhone and Android phones in the UK, 2017
Launch Activity and Innovation
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- Expedia adds concert tickets to its platform
- Customers get more transparency from a Holiday Value Index tool
- Thomas Cook announces strategic alliance with Expedia
- Facebook advertising targets those considering travel
- TripAdvisor launches Sponsored Placements
Advertising and Marketing Activity
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- Advertising continues its move to digital
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- Figure 28: Total above-the-line, online display and direct mail advertising expenditure on online travel/booking agents, by media type, 2015-17
- Trivago continues to dominate advertising spend
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- Figure 29: Total above-the-line, online display and direct mail advertising expenditure on online travel/booking agents, by advertiser, 2017
- Nielsen Ad Intel coverage
Brand Research
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- Brand map
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- Figure 30: Attitudes towards and usage of selected brands, April 2018
- Key brand metrics
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- Figure 31: Key metrics for selected brands, April 2018
- Brand attitudes: TripAdvisor leads in consumer trust and perception of quality
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- Figure 32: Attitudes, by brand, April 2018
- Brand personality: Trivago and TripAdvisor seen as fun options
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- Figure 33: Brand personality – Macro image, April 2018
- Hotels.com lowest across brands in perceptions of reliability and efficiency
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- Figure 34: Brand personality – Micro image, April 2018
- Brand analysis
- TripAdvisor’s extensive reviews make place it the most-used brand overall
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- Figure 35: User profile of TripAdvisor, April 2018
- Booking.com’s market leading position driven by its efficient focus on value
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- Figure 36: User profile of Booking.com, April 2018
- Expedia playing catch-up to Booking.com and Trivago in terms of brand image
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- Figure 37: User profile of Expedia, April 2018
- Marketing effectively boosts Trivago’s appeal and reach
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- Figure 38: User profile of Trivago, April 2018
- Hotels.com suffers from a lack of perceived trust and innovativeness
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- Figure 39: User profile of Hotels.com, April 2018
The Consumer – What You Need to Know
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- Online remains most popular booking channel
- Converting research into bookings
- OTAs a popular option for short-haul trips
- A third of most recent holidays were packages
- Laptops and desktops remain the preferred option for holiday bookings
- Consumers compare their comparison sites
- Consumers receptive to reward schemes
- Chatbots may change the holiday booking process
- An activity-first search appeals to over half of consumers
- Travellers are engaged in the holiday planning process
- Piecemeal holiday booking looks likely to stay
Holiday Booking Channels
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- Online remains most popular booking channel
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- Figure 40: Proportion of consumers who booked a holiday in the last 12 months, April 2018
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- Figure 41: Ways in which consumers booked their holidays in the last 12 months, April 2018
- Converting research into bookings
- Adding complexity to the booking process
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- Figure 42: Providers used to research and book holidays online in the last 12 months, April 2018
- Travel comparison favours a younger market…
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- Figure 43: Providers used to research and book holidays online in the last 12 months, by age, April 2018
Holidays Booked through Online Travel Aggregators
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- OTAs a popular option for short-haul trips
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- Figure 44: Type of holiday most recently booked via travel comparison websites/apps, April 2018
- A third of most recent holidays were packages
- At least 48% of holidays abroad are not ATOL protected
- Accommodation-only bookings reserved for UK trips
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- Figure 45: Services booked via travel comparison websites/apps for the most recent holiday, April 2018
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- Figure 46: Services booked via travel comparison websites/apps for the most recent holiday, by type of holiday booked, April 2018
Devices Used to Access Online Travel Aggregators
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- Laptops and desktops remain the preferred option for holiday bookings
- Mobile becomes a viable option for booking
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- Figure 47: Devices used for research and booking holidays via travel comparison websites/apps, April 2018
Booking Behaviour on Online Travel Aggregators
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- Consumers compare their comparison sites
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- Figure 48: Repertoire of comparison websites/apps used to book holidays, April 2018
- Consumers receptive to reward schemes
- Loyalty schemes appeal more to higher economic groups
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- Figure 49: Consumer behaviour related to travel comparison sites/apps, April 2018
- Protections available to holidaymakers
- Chatbots may change the holiday booking process
Attitudes towards Online Travel Aggregators
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- An activity-first search appeals to over half of consumers
- Travellers are engaged in the holiday planning process
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- Figure 50: Attitudes towards holiday planning and booking processes, April 2018
- Consumers still perceive OTAs as better value than traditional travel agents
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- Figure 51: Attitudes towards the value of deals from comparison sites, by age, April 2018
- Piecemeal booking styles seems here to stay
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
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