Travel Booking - US - August 2014

SCOPE AND THEMES
What you need to know
Definition
Data sources
Sales data
Consumer survey data
Direct marketing creative
Abbreviations and terms
Abbreviations
Terms
EXECUTIVE SUMMARY
The market
Figure 1: US total travel sales ($bn), online and offline, 2010-16
Market drivers
Leading companies
Figure 2: US online travel agency market share, 2013
Marketing strategies
The consumer
Online booking is the norm, few have used mobile – but one quarter still use offline
Figure 3: How reservations for most recent personal flight/other travel were made, June 2014
With airlines, starting the search is split; for other travel, OTAs are the first stop
Figure 4: Where online airline ticket/other travel searches begin, June 2014
Searching for airfares is often a multi-step process
Figure 5: Online airline ticket search methods, June 2014
Cost and convenience drive travel booking decisions
Figure 6: Most important factors in how to book travel, June 2014
Expedia is most popular OTA; Travelzoo users are more frequent visitors
Figure 7: Travel websites visited in the last 30 days, January 2013-March 2014
What we think
ISSUES AND INSIGHTS
What is the future for the travel agent model?
The issues
The implications
Is there room for new OTAs, or is the market saturated?
The issues
The implications
What will be the impact of mobile? Do consumers really want apps?
The issues
The implications
TREND APPLICATION
Trend: FSTR HYPR
Trend: Guiding Choice
Trend: Access All Areas
MARKET SIZE AND FORECAST
Key points
Market for online travel booking
Figure 8: Total online travel sales ($bn) worldwide, by region, 2010-16
Figure 9: Total online travel sales ($bn) – US compared to total, 2010-16
Market for total travel booking
Figure 10: Total travel sales worldwide ($bn), by region, 2010-16
Figure 11: Total travel sales ($bn) – US compared to total, 2010-16
Figure 12: US total travel sales ($bn), online and offline, 2010-16
MARKET DRIVERS
Key points
Unemployment declines; consumer sentiment rises
Figure 13: Consumer sentiment index and unemployment, annual averages, 2000-13, January-June 2014
Travel sentiment trending upward
Figure 14: Traveler Sentiment Index, March 2007-April 2014
Internet penetration and mobile device adoption increase
Figure 15: World internet usage and population statistics, December 2013
Figure 16: Smartphone and tablet penetration in the US, 2010-17
COMPETITIVE CONTEXT
Overview of the competitive landscape
Key points
Booking method overview
Figure 17: How personal airline travel and other travel reservations were made, June 2014
Figure 18: How online airline ticket/other travel searches begin, June 2014
LEADING COMPANIES
Key points
The Priceline Group
Figure 19: Priceline Group company background
Priceline.com
Booking.com
Kayak.com
Other brands/notable business units
Expedia Inc.
Figure 20: Expedia Inc. company background
Expedia.com
Hotwire.com
Hotels.com
Trivago.com
Other brands
Sabre Inc.
Figure 21: Sabre Inc. company background
Travelocity.com
Orbitz Worldwide Inc.
Figure 22: Orbitz worldwide Inc. company background
Orbitz.com
CheapTickets.com
Other brands
TripAdvisor Inc.
Figure 23: TripAdvisor Inc. company background
TripAdvisor.com
Viator.com
Other travel booking companies
MARKET SHARE OF ONLINE TRAVEL AGENCIES
Key points
Four brands account for 95% of share
Figure 24: US online travel agency market share, 2013
Site traffic reflects dominance of major OTAs
Figure 25: Estimated US monthly site visits of leading online travel agencies, December 2013-June 2014
Domestic revenues of leading OTAs puts Expedia in the lead
INNOVATIONS AND INNOVATORS
Leading companies improve price transparency while saving customers’ time
Expedia.com rolls out Flight Recommendations and Scratchpad
TripAdvisor launches price adjustment site Tingo
Rewards programs turn site hoppers into loyal shoppers
Expedia+ Rewards
Orbitz Rewards
CheapCash
Meta-searches get personal with SuperFly
Friends of a feather fly together using TripCommon
Peek transforms visual bookmarks into real-life travel experiences
Mobile apps provide access to travelers on the go
Digital currency takes to the air
MARKETING STRATEGIES
Overview of the brand landscape
A brief history of online travel bookers…
It’s an (online) ad ad ad ad world
Advertising channels and company activity
Booking.com, Expedia Inc., Priceline.com are top mobile, online, print advertisers
Figure 26: Share of travel company consumer campaigns, January 2013-June 2014
Mobile advertising dominates media channels
Figure 27: Share of travel company consumer campaigns, by media channel, January 2013-June 2014
Few travel companies deviate from a focus on mobile
Figure 28: Share of travel company consumer campaigns, by media channel, January 2013-June 2014
Mobile, online, print, and TV ads from top companies
American Express
Figure 29: American Express, Platinum/Centurion Travel Service, print advertisement, January 2013
Figure 30: American Express Travel Services, online advertisement, February 2013
Figure 31: American Express Travel Service, print advertisement, December 2013
Booking.com
Figure 32: Booking.com “Booking.yeah” TV ad, January 2013
Figure 33: Booking.com “Booking Right” TV ad, February 2013
Figure 34: Booking.com, mobile ad, June 2014
Expedia.com
Figure 35: Expedia.com, mobile ad, June 2014
Figure 36: Expedia.com, mobile ad, June 2014
Hotwire.com
Figure 37: Hotwire.com mobile ad – hotels, June 2014
Figure 38: Hotwire.com mobile ad – cars, March 2014
Kayak.com
Figure 39: Kayak “Lecture” – “Search one and done” TV ads, 2014
Figure 40: Booking.com from Kayak.com mobile ad, February 2014
Orbitz
Figure 41: Orbitz mobile ad, April 2014
Figure 42: Orbitz, mobile ad, February 2013
Priceline.com
Figure 43: Priceline Shocker: the Negotiator’s Secret Daughter Revealed, 2013
Figure 44: Priceline.com mobile ad, June 2014
Travelocity.com
Figure 45: Travelocity.com mobile ad, June 2013
Figure 46: Travelocity Roaming Gnome: “Beached” TV ad, 2014
TripAdvisor
Figure 47: TripAdvisor mobile ad, December 2013
Viator
Figure 48: Viator mobile ad, May 2014
Figure 49: Viator online ad, June 2014
SOCIAL MEDIA
Key points
Market overview
 KEY SOCIAL MEDIA METRICS
Figure 50: Key social media metrics for select travel booking sites, July 2014
Brand usage and awareness
Figure 51: Brand usage and awareness for select travel booking sites, June 2014
Interactions with travel booking sites
Figure 52: Interaction levels for select travel booking sites, June 2014
 LEADING ONLINE CAMPAIGNS
Partnerships
Highlighting travel destinations
Mobile
Nostalgia
What we think
 ONLINE CONVERSATIONS
Figure 53: Share of conversation for select travel booking sites, by week, July 28, 2013-July 27, 2014
Where are people talking about travel booking?
Figure 54: Share of conversations for select travel booking sites, by page type, July 28, 2013-July 27, 2014
What are people talking about?
Figure 55: Topics of conversation for select travel booking sites, July 28, 2013-July 27, 2014
METHOD FOR BOOKING MOST RECENT TRAVEL
Key points
Booking online using a traditional computer is preferred method
Figure 56: How reservations for most recent travel were made, June 2014
Younger adults more tech-savvy – but less likely to book air travel online
Figure 57: How reservations for most recent flight were made, by generations, June 2014
Online booking most common – but some men gravitate offline
Figure 58: How reservations for most recent flight – for personal reasons – were made, by gender, June 2014
Figure 59: How reservations for most recent travel were made, by gender, June 2014
Younger adults less inclined to book online; more comfortable with smartphones
Figure 60: How reservations for most recent flight – for personal reasons – were made, by age, June 2014
Figure 61: How reservations for most recent travel were made, by age, June 2014
Insight: Design travel booking apps for mobile Millennial women
Figure 62: How reservations for most recent travel were made, by gender and age, June 2014
WHO BOOKS TRAVEL ONLINE
Key points
Three quarters of air travelers book for themselves online
Figure 63: Past 12 month airline travel booking, by gender and age, June 2014
18-34-year-old men least likely to book air travel themselves online
Figure 64: Past 12 month airline travel booking, by gender by age, June 2014
Online air travel booking increases with affluence
Figure 65: Past 12 month airline travel booking, by household income, June 2014
Other transportation booking follows similar demographic trends
Figure 66: Past 12 month travel transportation booking, by gender, age, and household income, June 2014
Six in 10 book accommodations online
Figure 67: Past 12 month travel accommodations booking, by gender and age, June 2014
Figure 68: Past 12 month travel accommodations booking, by gender by age, June 2014
Figure 69: Past 12 month travel accommodations booking, by household income, June 2014
ONLINE SEARCHING AND BOOKING TOOLS
Key points
 AIRLINES
Travelers split on searching airfares via suppliers or consolidators
Equipment
Figure 70: Online airline ticket search and reservations, June 2014
Age impacts preferences for online ticket searches and booking platform
Search
Equipment
Figure 71: Online airline ticket search and reservations, by age, June 2014
Searching for airfare is a multi-step process
Figure 72: Online airline ticket search methods, June 2014
Figure 73: Online airline ticket search methods, by age, June 2014
 OTHER TRAVEL AND ACCOMMODATIONS
Other travel searches more likely to begin with an OTA than a supplier
A note about SEs and Google
Figure 74: Online travel search and reservations, June 2014
Starting with an OTA more common among younger travelers
Figure 75: Online travel search and reservations, by age, June 2014
FACTORS IMPACTING HOW TO BOOK TRAVEL
Key points
Cost and convenience drive travel booking decisions
Figure 76: Most important factors in how to book travel, June 2014
Age influences travelers’ motivations for booking method
Figure 77: Most important factors in how to book travel, by age, June 2014
How bookings are executed sheds light on influential factors
Figure 78: Most important factors in how to book travel, by how reservations for most recent travel were made, June 2014
ONLINE TRAVEL SITES
Key points
Nearly one third have booked travel online in the last 12 months
Figure 79: Travel booking in previous 12 months – online and travel agent, by age, January 2013-March 2014
Nearly six in 10 of the most affluent consumers booked online in the last year
Figure 80: Travel booking in previous 12 months, by household income, January 2013-March 2014
About one quarter visit an online travel site on monthly basis
Figure 81: Frequency of visiting airline/car/hotel information or reservations sites in previous 30 days/past seven days, by age, January 2013-March 2014
Expedia is most popular; Travelzoo users are the most frequent visitors
Figure 82: Frequency of visiting travel websites, January 2013-March 2014
IMPACT OF RACE AND HISPANIC ORIGIN
Key points
Method for booking most recent travel
Figure 83: How reservations for most recent travel were made, by race/Hispanic origin, June 2014
Online searching and booking tools
Airlines
Figure 84: Online airline ticket search and reservations, by race/Hispanic origin, June 2014
Online searching methods – airlines
Figure 85: Online airline ticket search methods, by race/Hispanic origin, June 2014
Other travel and accommodations
Figure 86: Online travel search and reservations, by race/Hispanic origin, June 2014
Factors impacting how to book travel
Figure 87: Most important factors in how to book travel, by race/Hispanic origin, June 2014
Online travel sites
Figure 88: Frequency of visiting airline/car/hotel information or reservations sites in previous 30 days/past seven days, by race/Hispanic origin, January 2013-March 2014
Figure 89: Frequency of visiting travel websites, by race/Hispanic origin, January 2013-March 2014
Figure 90: Travel booking in previous 12 months – online and travel agent, by race/Hispanic origin, January 2013-March 2014
APPENDIX – SOCIAL MEDIA
Key social media metrics
Figure 91: Key social media metrics for select travel booking sites, July 2014
Online conversations
Figure 92: Share of conversation for select travel booking sites, by page type, July 28, 2013-July 27, 2014
Figure 93: Topics of conversation for select travel booking sites, July 28, 2013-July 27, 2014
Brand usage or awareness
Figure 94: Brand usage or awareness, June 2014
Figure 95: Kayak usage or awareness, by demographics, June 2014
Figure 96: Expedia usage or awareness, by demographics, June 2014
Figure 97: Priceline usage or awareness, by demographics, June 2014
Figure 98: Hotwire usage or awareness, by demographics, June 2014
Figure 99: Travelocity usage or awareness, by demographics, June 2014
Figure 100: Orbitz usage or awareness, by demographics, June 2014
Activities done
Figure 101: Social media activities done, by travel site, June 2014
Figure 102: Kayak – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
Figure 103: Kayak – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
Figure 104: Kayak – Activities done – I have researched the brand on social media to, by demographics, June 2014
Figure 105: Expedia – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
Figure 106: Expedia – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
Figure 107: Expedia – Activities done – I follow/like the brand on social media because, by demographics, June 2014
Figure 108: Expedia – Activities done – I have researched the brand on social media to, by demographics, June 2014
Figure 109: Priceline – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
Figure 110: Priceline – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
Figure 111: Priceline – Activities done – I follow/like the brand on social media because, by demographics, June 2014
Figure 112: Priceline – Activities done – I have researched the brand on social media to, by demographics, June 2014
Figure 113: Hotwire – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
Figure 114: Hotwire – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
Figure 115: Hotwire – Activities done – I have researched the brand on social media to, by demographics, June 2014
Figure 116: Travelocity – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
Figure 117: Travelocity – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
Figure 118: Travelocity – Activities done – I follow/like the brand on social media because, by demographics, June 2014
Figure 119: Travelocity – Activities done – I have researched the brand on social media to, by demographics, June 2014
Figure 120: Orbitz – Activities done – I have looked up/talked about this brand online on social media, by demographics, June 2014
Figure 121: Orbitz – Activities done – I have contacted/interacted with the brand online on social media to, by demographics, June 2014
Figure 122: Orbitz – Activities done – I have researched the brand on social media to, by demographics, June 2014
APPENDIX – OTHER USEFUL CONSUMER TABLES
Past 12 month travel booking
Figure 123: Past 12 month airline travel booking, by gender, age, and household income, June 2014
Figure 124: Past 12 month travel accommodations booking, by gender, age, and household income, June 2014
Figure 125: Past 12 month travel booking, June 2014
Figure 126: Past 12 month travel booking, by gender, June 2014
Figure 127: Past 12 month travel booking, by age, June 2014
Figure 128: Past 12 month travel booking, by household income, June 2014
Figure 129: Past 12 month travel booking, by race/Hispanic origin, June 2014
Figure 130: Past 12 month travel booking, by past 12 month travel booking, June 2014
Figure 131: Past 12 month travel booking, by past 12 month travel booking, June 2014
Method for booking most recent travel
Figure 132: How reservations for most recent travel were made, by household income, June 2014
Online searching and booking tools
Airlines
Figure 133: Online airline ticket search and reservations, June 2014
Figure 134: Online airline ticket search and reservations, by household income, June 2014
Figure 135: Online airline ticket search and reservations, by generations, June 2014
Other travel
Figure 136: Online travel search and reservations, June 2014
Figure 137: Online travel search and reservations, by gender, June 2014
Figure 138: Online travel search and reservations, by household income, June 2014
Online searching methods
Airlines
Figure 139: Online airline ticket search methods, June 2014
Figure 140: Online airline ticket search methods, by gender, June 2014
Online travel sites
Figure 141: Frequency of visiting airline/car/hotel information or reservations sites in previous 30 days/past seven days, by age, January 2013-March 2014
Figure 142: Travel booking in previous 12 months – online and travel agent, by age, January 2013-March 2014
Figure 143: Travel booking in previous 12 months, by household income, January 2013-March 2014
Figure 144: Travel booking in previous 12 months, by marital status, January 2013-March 2014
Figure 145: Travel booking in previous 12 months, by parents with children in household, January 2013-March 2014
Figure 146: Travel booking in previous 12 months, by marital status and presence of children in household, January 2013-March 2014
Figure 147: Frequency of visiting travel sites in previous 30 days, and use of mobile device to access, by race/Hispanic origin, January 2013-March 2014
Figure 148: Use of travel apps, by race/Hispanic origin, January 2013-March 2014
Figure 149: Frequency of visiting travel websites, by race/Hispanic origin, January 2013-March 2014
Factors impacting how to book travel
Figure 150: Most important factors in how to book travel, June 2014
Figure 151: Most important factors in how to book travel, by gender, June 2014
Figure 152: Most important factors in how to book travel, by household income, June 2014
APPENDIX – TRADE ASSOCIATIONS