Online Travel Agents Market Definition
The online travel agent market consists of sales of travel services through online channels. Online travel agents or agencies are those individuals or companies that have websites that allow consumers to book various travel related services via the internet. Travel agents are engaged in the sales of travel services such as flights, buses, vacation packages, hotels, and rental cars via online networks.
An online travel agent (OTA) is an individual or a company that provides a web-based marketplace, which allows consumers to research and book travel products and services, such as hotels, flights, cars, tours, and cruises, among others, directly with travel suppliers.
Online Travel Agents Market Size
The global online travel agent market reached a value of nearly $460.9 billion in 2020, having decreased at a compound annual growth rate (CAGR) of -3.5% since 2015. The online travel agent market increased from $460.9 billion in 2020 to $972.1 billion in 2025 at a rate of 16.1%. The decrease is mainly due to COVID-19 pandemic across all countries in the world as most countries went into lockdown with severe travel restrictions. Subsequently, industries such as airlines, railways, hospitality, and tourism all suffered major setbacks. The online travel agent market is expected to grow at a CAGR of 5.9% from 2025 and reach $1,259.1 billion in 2030.
Growth factors in the historic period include strong economic growth in emerging markets, rapid population growth, demographic shift, improved earning capacity, rise in E-commerce, acceptance of solo travel and technological advances. Factors that negatively affected growth in the historic period were skilled workforce shortages, high taxes on air travel, and demand for offline travel agencies.
Going forward, shift in travel trends, resurgence of staycation, faster economic growth, surge in smartphone users, increased car rental opportunities, technology, and government initiatives will drive the market for online travel agent. Factors that could hinder the growth of the online travel agent market in the future include geopolitical tensions, government regulations, and coronavirus pandemic.
Online Travel Agents Market Drivers
The key drivers of the online travel agents market include:
Shift In Travel trends
Rapid shift in travel trends towards business leisure (bleisure) and food tourism is expected to be a major driver for online travel agent market. Bleisure travel refers to the hybrid travel model that includes both business travel and leisure travel. The individuals during their business trips to various countries prefer to explore the local cuisine, travel locations post completion of their official work. According to the Global Business Travel Association, one in three business travelers will add a leisure component in at least one of their business trips a year. Food tourism is another major trend that is expected to drive the market for online travel agent. Food tourism focuses on authentic culinary experiences. Over the last few years, there has been increasing shift towards experiencing local delicacies of specific countries in unique food and beverages activities while travelling in the last two years.
Online Travel Agents Market Restraints
The key restraints on the online travel agents market include:
Geopolitical tensions are likely to have a negative impact on the online travel agent market during the forecast period. Repercussions of geopolitical tensions included sanctions on Russia, trade protectionism and heightened military tensions in the Middle East. For instance, Brexit is likely to lead to more trade restrictions between the UK and other countries in Europe. The USA is also implementing several trade restrictions, especially with China, to boost its local production. For example, in the USA, as on mid 2019, increased input costs due to steel and aluminum tariffs (in March 2018) resulted in 0.6% fewer jobs accounting for 75,000 fewer jobs in manufacturing sector. Geo-political tensions will result in job losses, which in turn will decrease the disposable incomes and spending power of individuals, and discourage them from touring and traveling. This will hinder the growth of the market going forward.
Online Travel Agents Market Trends
Major trends influencing the online travel agents market include:
Demand From Solo Travelers
Solo traveling is becoming increasingly popular due to changing lifestyles; with many people partnering and settling down later in life, young people taking gap years to travel independently, high divorce rates in many countries and the growing acceptance of solo travel. The demand from solo travelers is rising which is increasing opportunities for the travel industry. According to statistics, solo travel bookings increased to 42% in 2020 from 2018. The players in the travel industry are offering different flexible and cashless packages to attract these solo travelers.
Increasing Customer Acquisition
Players in the online travel industry are increasingly focusing on customer acquisition by launching direct booking platforms, these platforms enable customers to make a booking for their travel or accommodation from anywhere at any time, using their smartphone, these platforms attract a greater number of customers. The direct booking services through different platforms such as apps, websites, social media, and others offer an opportunity for players in the online travel agent market to engage with a greater number of customers and build positive customer relationships. For instance, in 2020, Skyscanner Ltd., a Scotland based travel agency launched its direct booking services to focus on customer acquisitions.
Opportunities And Recommendations In The Online Travel Agents Market
Opportunities –The top opportunities in the online travel agent market segmented by service type will arise in the travel market segment, which will gain $244.1 billion of global annual sales by 2025.
Recommendations-To take advantage of the opportunities, the business research company recommends the online travel agent companies to focus on travel trends, smartphone users, and launching direct booking platform, expanding in emerging and developed markets, focus on merger and acquisitions, offer competitive and dynamic pricing, focus on marketing through SEO activities, use DTC advertising, increase visibility through high performance websites, focus on solo travelers, and millennials.
Online Travel Agents Market Segmentation
Online travel agents market is segmented by service type, by mode of transport, and by mode of booking.
By Service Type–
The online travel agents market is segmented by service type into
The travel market was the largest segment of the online travel agent market segmented by service type, accounting for 42.2% of the total in 2020 and going forward the travel market is expected to be the fastest growing segment in the online travel agent market by service type, at a CAGR of 17.6% during 2020-25.
- a) Vacation Packages
- b) Travel
- c) Accommodation
By Mode Of Transport–
The online travel agents market is segmented by mode of transport into
The others market was the largest segment of the online travel agent market segmented by service type, accounting for 69.4% of the total in 2020 and going forward the air transport market is expected to be the fastest growing segment in the online travel agent market by mode of transport, at a CAGR of 18.3% during 2020-25.
By Mode Of Booking –
The online travel agents market is segmented by mode of booking into
The direct market was the largest segment of the online travel agent market segmented by service type, accounting for 58.4% of the total in 2020 and going forward the online mode market is expected to be the fastest growing segment in the air travel market by mode of booking, at a CAGR of 18.4% during 2020-25.
- a) Online
- b) Offline
- c) Direct
By Geography -
The online travel agents market is segmented by geography into
o North America
o Western Europe
Asia Pacific was the largest region in the global online travel agent market, accounting for 32.8% of the total in 2020. It was followed by Western Europe, North America and then the other regions. Going forward, the fastest-growing regions in the online travel agent market will be Asia-Pacific, and Africa, where growth will be at CAGRs of 19.1% and 16.1% respectively. These will be followed by North America and Western Europe, where the markets are expected to grow at CAGRs of 15.5% and 14.0% respectively.
o Asia Pacific
o Eastern Europe
- Hong Kong
- New Zealand
- South Korea
o South America
- • Russia
- • Czech Republic
- • Poland
- • Romania
o Middle East
- • Brazil
- • Argentina
- • Chile
- • Colombia
- • Peru
- • Venezuela
- • Saudi Arabia
- • Israel
- • Turkey
- • UAE
- • Egypt
- • Nigeria
- • South Africa
Online Travel Agents Competitive Landscape
Major Competitors Are:
Booking Holdings Inc.
Expedia Group Inc
Trip.com Group Limited
Other Competitors Include:
Tongcheng Network Technology Co
China International Travel Service Corporation Limited
JTB (Japan Travel Bureau) Corporation
Flag Travel Holidays
On the Beach Group plc
We Love Holidays Ltd
Secret Escapes Ltd
Voyage Prive UK
Destination Services Mexico
Bel Air Travel
Lonely Planet Global Inc
Say Hueque Argentina Journeys
Scenic Luxury Cruises & Tou
National Geographic Journey
Expat Explore Travel
Vacations to go travel
Cape Town Day Tours
Kabura Travel & Tours
On The Go Tour
Zenith Travels and Tours Limited
Mayfair Travel Nigeria limited
Gadeshire Travels & Tours Limited
Finchglow Travel Agency Nigeria Limited
GMT Travels And Tours Limited