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Online Travel Agency Market is anticipated to reach USD 911.45 Million by 2031 up from USD 463.29 Million in 2022. The market is growing at a CAGR of 16.98% from 2023-2031.
The online travel agency market has huge potential to grow in the upcoming years with a substantial growth rate. The market growth is supported by various factors such as rising internet penetration in the tourism sector, availability of secure transactions by OTA’s, rising disposable income, increasing promotional activities for tourism. Over the past few years, online travel bookings have gone through several changes owing to technological advancement.
Rising internet usage in tourism and user-friendly applications for smartphones has made the booking process easier. This is estimated to drive the market at a considerable rate in the forecast period. Major online travel agencies are spending a huge amount to promote travel. For instance, Booking.com and Expedia Inc. spent around US$5 billion each in the year 2020 to promote tourism and to gain customer attraction. Rising promotional activities have influenced customers to travel more and thus propelling the market significantly. OTA is also providing customized plans according to customer interest in travel and accommodation for a better travel experience.
Tourism is one of the major industries affected by COVID-19 due to global lockdown and home quarantine. The COVID-19 pandemic has put the tourism industry under tremendous pressure. However, government initiatives to promote the tourism sector after COVID -19 have played a major role to support the online travel agency market globally. For instance, In the 2020-2021 budget, the Government of India has allotted US$ 171 Million and US$ 30 Million under Swadesh Darshan Scheme and Prashad Scheme respectively to promote tourism in India. Europe commission has also adopted comprehensive packages in May 2020 to resume transportation and tourism safely.
Segmentation Overview of Online Travel Agency Market (OTA)
The online travel agency market has been segmented based on the business model, platform, product type, customer segment, and region. These major segments are further categorized into sub-segments to study the market in detail.
Geographically, The online travel agency market has been divided into North America, Asia Pacific, Europe, Middle East and Africa, and the rest of the world. As per the studies, Europe is accounted for the highest market share owing to various reasons such as high disposable income and the growing tourism sector. Tourism is the major economic growth sector in Europe which is propelling the online travel agency market in Europe region significantly. North America is the second-largest market shareholder for the online travel agency (OTA) market. However, Asia Pacific region is expected to grow with the highest CAGR of 15.8% in the forecast period owing to the rising use of online travel service applications for mobiles/smartphones.
The major players in the market are Expedia Inc., Booking Holdings Inc., Ctrip.com International Ltd, Trivago, Tripadvisor, Makemytrip Pvt. Ltd, Thomas Cook Group PLC among others. To sustain the competitive environment, various online travel agencies are collaborating with hotel groups and transportation companies to provide affordable services to the customers. For instance, in 2018, Cleartrip acquired Flyin to gain a competitive edge and increase its customer base in the Middle East and Africa region.