Which Way Is the Travel Industry Headed?
Travel planning and booking are among the most popular online activities and online travel sales are booming.
"Without question, the Internet has shaken up the status quo in the travel industry," says Jeffrey Grau, Senior Analyst at eMarketer and author of the Online Travel Worldwide report. "Traditional travel agencies are struggling to stay relevant, online travel agencies are trying to instill loyalty among their customers, travel search engines are the new upstarts, travel suppliers are flexing their muscles and global distribution systems are looking for ways to reverse their waning influence."
Only two things are certain in the travel industry today: the stakes are high and the competition is intense.
The World Travel & Tourism Council (WTTC), a London-based business leaders' forum that promotes the travel and tourism industry, estimates that worldwide spending for personal travel will reach $2.8 trillion in 2005.
But where is the business going?
"As they effortlessly shop across multiple sites in search of bargains," says Mr. Grau, "online traveler shoppers show little loyalty to travel providers."
The main online competition is between online travel agencies (also referred to as portals or aggregators), which currently draw the highest volume of visitor traffic, and direct suppliers, such as airlines and hotels, that draw customers to their Web sites with aggressive lowest-price guarantees and loyalty promotions. The latest entry into the competition: travel search engines that are ideal for comparing prices in a commodity market.
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Source - eMarketer
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