Online Travel Statistics
The internet has drastically changed the way America conducts business. One industry in particular has seen a dramatic shift from storefront transactions to an online model, the travel industry. The days of booking vacations during a face-to-face meeting with a travel agent are declining as more and more travelers turn to the internet.
According recent data from the Travel Industry Association of America, the online market continues to grow. Looking back, in 1999, 15.1 million U.S. adults booked their travel reservations online. In 2000, that number jumped to 24.7 million. In 2003, the number people making online travel arrangements increased to 42.2 million. Each year since has seen record growth of consumers who use the internet for making their travel arrangements.
Research by eMarketer concludes that in 2006, consumers spent roughly $79 billion in online travel arrangements. They project an annual growth rate of 17 percent and expect that this number will reach $146 billion by 2010. Jupiter Research projects slightly lower figures of $125 billion in online bookings by 2011. Despite the discrepancies, the internet travel industry is booming. By 2011, a full 38 percent of all travel is expected to be conducted online.
Among the major players in the online travel business are Expedia, Travelocity, Orbitz, Yahoo Travel, Cheap Tickets, Hot Wire, VIPfares, Priceline.com, ITN.net, and TravelNow.com.
Expedia, and similar websites, allow users to search for bargains by specifying desired dates and destinations. The website displays a list of fares including airfare, hotel accommodations, car rentals and more. Users can book vacation packages, cruises, plan activities, and conduct research from one handy website.
Other online travel arrangements are made directly from airline carriers such as Delta or Southwest Airlines as well as through the hotel websites and car rental company websites. Vacationers in search of the best deal often go from website to website until they’ve determined that they have made the right decision.
Priceline uses a “name your price” model that allows travelers to specify how much they are willing to pay. The user must commit to the price and carrier by providing a credit card number and agreeing to accept whoever can meet their price. This model is ideal for those without strong preferences for a particular provider.
In addition to these travel powerhouses, many traditional travel agents have migrated from a traditional business model to one that incorporates online travel arrangements. While the U.S. Department of Labor predicts that the employment of travel agents is likely to decline through 2014, the need for agents still exists. With up to 38 percent of all travel transactions occurring online, over 60 percent will require the service of a travel agent.
Competition for jobs in the travel industry is fierce due to the perks and relatively short training period at post-secondary vocational schools. A typical agent earned a median income of $27,640 in 2004. Most travel agents work in agencies however about 14 percent are self-employed.
While many consumers will continue to flock to the net to get good deals, many will abandon these transactions due to credit card concerns, frustration with navigating poor websites, and the inability to make specific requests online. A travel agent can bridge the gap and play a vital role in fueling the industry.
In addition, travel agents provide personal service that no website can compete with. From finding the perfect itinerary to meet any budget or taste, to digging up insider deals and information, a good travel agent is a vacationer’s best friend. Agents can assist with travel advisories, act as an advocate should something go wrong, help with passports, insurance, vaccinations, and much more.
In addition to personal service, travel agents can also provide travelers with bargains. They have access to deals through the relationships they’ve built with major suppliers. In fact, travel agents are responsible for booking over 87 percent of all cruises and over half of all airline tickets. They are experienced in navigating the fluctuating complexities of booking business and vacation airfares and hotel accommodations.
For 2007, Americans will spend over $647 billion dollars on their vacation and business travel arrangements. A big chunk of that money will through Expedia and the other top online travel providers but a larger portion will be booked through traditional means including travel agencies and travel agents. Travel agencies that can harness both the personal touch as well as the internet are poised for success even as the industry continues to move toward online transactions.
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