Online Travel Agencies Market

Online Travel Agencies Market Outlook (2023 to 2033)

As per newly released data by Future Market Insights (FMI), the online travel agencies market is estimated at USD 465.1 million in 2023 and is projected to reach USD 1,694.2 million by 2033, at a CAGR of 13.8% from 2023 to 2033.

Attribute	Details
Online Travel Agencies Market Size (2023)	USD 465.1 million
Online Travel Agencies Market Projected Size (2033)	USD 1,694.2 million
Online Travel Agencies Market Value-based CAGR (2023 to 2033)	13.8%

Revenue of Online Travel Agencies from 2018 to 2022 Compared to Demand Outlook for 2023 to 2033

As per the FMI analysis, the market for online travel agencies secured a 6.70% CAGR from 2018 to 2022, touching USD 355.4 million in 2022.

The technological development in the tourism industry has digitalized the entire process of travel bookings. Nowadays traveler makes more use of online services for travel booking as they feel it is a convenient and hassle-free process.

The online process has led to the growth of the tourism and hospitality industry. Therefore, online travel agencies play a significant role in the tourism industry.

Online travel agencies comprise various travel bookings, hotel bookings, transportation service bookings, and many more.

Online travel agencies serve the purpose of selling travel services on online platforms. In the last few years, there is a significant rise in the growth of online travel agencies. The growth has helped to revolutionize the tourism industry.

The above-mentioned factors augur well for the online travel agencies market future trends, where it is predicted that the market likely reaches USD 1,694.2 million by 2033 at 13.8% CAGR through 2033.

What are the Features and Convenience of Use that Drive the Demand for the Online Travel Agencies?

• Online travel agencies offer a range of services either directly from their own companies or act as intermediaries between travel and booking agencies and end users.
• The main purpose of online travel agencies is to provide booking services online, covering everything from selecting a service to the point of sale on the Internet.
• Online portals offered by these agencies provide various services including price comparison, cost estimation, accommodation options, destination information, transportation modes, and even tour packages.
• The convenience, speed, and ease of booking provided by online travel services attract travelers, offering a convenient and efficient way to plan their trips.
• By utilizing online travel services, travelers can save both time and money, making it an appealing option for those seeking efficient and cost-effective travel arrangements.

What is Fostering the Expansion of the Market Size: The Rise in Disposable Income and New Development Initiatives?

• Increasing disposable income among individuals has played a significant role in driving the demand for online travel agencies, as people now have more financial resources to explore and travel to various destinations worldwide.
• Online travel agencies have successfully established a global reach, expanding their services and operations across different regions and countries, catering to the diverse travel needs and preferences of customers.
• To meet the evolving demands of the market, online travel agencies continuously adopt new strategies and upgrade their technologies, ensuring enhanced service offerings and improved customer experiences.
• The inclusion of travel insurance and baggage insurance by online travel agencies provides an added layer of security and peace of mind for travelers, contributing to the overall convenience and reliability of their services.
• Transparency throughout the booking process is a key focus for online travel agencies, ensuring customers have access to comprehensive information and pricing details, fostering trust and confidence in their decision-making.
• The initiatives taken by online travel agencies, such as integrating advanced technologies and providing comprehensive travel solutions, have successfully attracted the new generation of tech-savvy travelers, generating a strong demand in the market.
• Despite the challenges faced during the pandemic, the online travel agencies market remains resilient and continues to evolve, adapting to changing customer expectations and emerging market trends.

What Impact Does the Increasing Number of Solo Travelers Have on the Growth of the Online Travel Agencies Industry?

• There has been a significant increase in the number of solo travelers in recent years, driven by specific reasons such as leisure, recreation, and engaging in activities like water sports, hiking, riding, skiing, and more.
• The influence of social media has played a major role in attracting a wide audience to explore different regions, leading to a rise in online travel agencies' booking transactions.
• Online travel agencies offer comprehensive tour plans, including vacation packages, and assist solo travelers in making travel, food, and accommodation arrangements through convenient platforms such as phones or other devices.
• This convenience and affordability make online travel agencies a preferred choice for solo travelers, who may lack extensive knowledge or prefer cost-effective options.
• In recent years, online travel agencies have surpassed offline tour operators and travel agents in terms of popularity and usage among solo travelers.

Country-wise Insights

What is the Growth Outlook for the Europe Online Travel Agencies Industry?

The growth outlook for the Europe online travel agencies industry is positive, with a value share of 22.30% in 2022. The industry is expected to continue growing steadily, supported by various factors such as increasing online travel bookings, technological advancements, and evolving customer preferences.

The CAGR of the United Kingdom at 5.00% from 2023 to 2033 indicates a promising growth trajectory for the market. The rising adoption of online platforms for travel planning and booking, along with the convenience and extensive range of services offered by online travel agencies, are driving the industry's growth.

The industry is likely to witness further advancements in mobile applications, personalized travel experiences, and innovative marketing strategies, contributing to the expansion of the Europe online travel agencies market in the coming years.

How Online Travel Agencies Market is Progressing in India?

In India online leading companies like Yatra.com, Kesari Tours, Veena World, Make My Trip, others are dominating the tourism industry in India, contributing to the country’s anticipated CAGR of 6.0% from 2023 to 2033.

India attracts many foreigners to discover and explore its culture and diversity. Foreigners find Indian travel agencies more affordable than booking tours from abroad. Hence, they use Indian online travel agencies’ websites for booking accommodation and transportation.

Meanwhile, India being one of the leading countries in the count of internet users, it can be concluded that the vast majority of the population is tech-savvy. Thus, online travel agencies try various marketing tools to connect with travelers and encourage them to avail of their services.

The attractive advertisements, loyalty programs, and offers from leading online travel agencies have influenced the domestic market. Therefore, the known online agencies have gained the trust of domestic travelers of the country over the years.

What are the Factors Driving the Online Travel Agencies Industry in the United States of America?

As per the FMI analysis, the market for online travel agencies in the United States was predicted to garner a value share of 5.50% in 2022.

United States is one of the major markets of tourism with millions of travelers visiting every year. Domestic travelers in the United States of America use online travel agencies’ websites and applications extensively.

Apart from this, the airline service is availed by United States citizens majorly. Therefore, there is a high demand for travelers using online travel agencies’ websites for airline travel booking.

With the high standard of living and high disposable income due to the high value of currency travelers are ready to spend a high amount of money on traveling and exploring new adventures. Thus, there is a high demand from travelers for luxury tourism, adventure sports, and various type of outdoor activities.

Category-wise Insights

Which Service Type is More Preferred by Travelers in Online Travel Agencies Market?

According to the analysis, in terms of service type the transportation service is widely preferred by travelers with the sub-segment holding a 22.0% value share in 2022.

Transportation services generate a high demand for their services. Few the transport services such as car rentals or bus travel agencies are in heavy demand as they are the part of daily mode of transport for many travelers.

Apart from this the attractive offers and schemes from the transportation services attract travelers to use these online services more often. Lastly, the transportation services are having a wide coverage of travelers as compared to the tour/vacation packages or accommodations as they generate demand only when there is a need.

How is the Competitive Landscape in the Market for Online Travel Agencies?

Leading players operating globally in the market are focusing on the expansion of their business. Also working on their service and creating advanced technology to attract new customers.

The competitive landscape in the market for online travel agencies is intense and dynamic. Numerous players, ranging from established companies to emerging startups, compete for market share.

Key industry players strive to differentiate themselves by offering unique features, enhanced user experiences, and a wide range of travel services.

They invest in advanced technologies, such as artificial intelligence and machine learning, to provide personalized recommendations and streamline booking processes. Additionally, partnerships with airlines, hotels, and other travel service providers are crucial to expand their offerings and provide competitive pricing.

Continuous innovation, customer-centric strategies, and effective marketing campaigns are vital for online travel agencies to gain a competitive edge in this rapidly evolving market.

Key Players

• Airbnb
• Expedia Group Inc.
• Booking Holding Inc.
• Trip Advisor Inc.
• MakeMyTrip Pvt. Limited
• Hostelworld Group PLC (HSW)
• Trivago N.V
• Thomas Cook India Ltd.
• Lastminute.com Group
• Despegar
• Orbitz Worldwide
• GetGoing
• Walt Disney World
• Skyscanner
• Kiwi.com
• Hotwire
• Agoda

For instance:

• In the year 2018, Booking.com announced a new product version of the booking.com application and website at Vacation Rental Management Association (VRMA). The new product features allow users to select the product of a partner’s brand beyond booking.com own products. Also, they introduced group connect, guest management, and enhance connectivity features in their new application.
• Recently in 2022, Expedia Group announced an Open World Technology platform. The technology is developed for partner agencies. The platform has a complete e-commerce suit, with various blocks like payments, chatbot, services, and fraud detection, and is perfect for the agency planning to enter the newly in online travel business.

Segmentation Analysis

By Service Type:

• Transportation
• Vacation Packages
• Accommodation

By Device Platform:

• Mobile
• Desktop

By Payment Modes:

• UPI
• E-Wallet
• Debit / Credit Card
• Others (Vouchers, Discount Codes)

By Booking Type:

• Online Travel Agents
• Direct Travel Agents

By Customer Segment:

• Corporate Traveller
• Individual Traveller

By Age Group:

• 15-25 Years
• 26-35 Years
• 36-45 Years
• 46-55 Years
• 66-75 Years

By Region:

• North America
• Latin America
• Europe
• East Asia
• South Asia
• Oceania
• MEA

Frequently Asked Questions

How is the Historical Performance of the Market?

During 2018 to 2022, the market grew at a 6.70% CAGR.

Who are the Key Market Players of this market?

Airbnb, Trip Advisor Inc., and Trivago N.V. are key market players.

What factors contribute to the attraction of this market in Europe?

Increasing online travel bookings raises the market.

How Big is this market?

This market is valued at USD 465.1 million in 2023.

How Big will be this Market by 2033?

This market is estimated to reach USD 1,694.2 million by 2033.