Travel suppliers are not realizing their full online market share potential,
despite projections that U.S. consumers will spend $16.6 billion online in
2003 on leisure and business travel, according to a new report.
Jupiter Communications said in report to its
Strategic Planning Services clients that suppliers such as airlines, car
rental companies, and hotels have allowed their sites to stagnate and must
continue to market aggressively to acquire and improve execution to retain
today’s travel consumer.
“Online consumers are being courted by more and better travel options, and
travel players are letting the opportunity to retain these consumers slip,”
said Fiona Swerdlow, research analyst for Jupiter’s Digital Commerce
Strategies.
“In the last two years, suppliers geared up and moved to disintermediate the
travel agent market. However, despite falling commissions and increased
competition, travel agents have conceded only one percent of the U.S. online
travel market.”
Jupiter’s new travel projections show that air travel will continue to
dominate the travel products sold online, representing more than 80 percent
of the online travel market.
However, as online car and hotel bookings continue to climb, that share will
fall to 60 percent of what promises to be a $16.6 billion market in 2003.
Jupiter’s research also indicates that 66 percent of online consumers have
used the Web
to research and or book travel online, which will result in nearly 10 percent
of the U.S. travel market will be booking online in 2003.
“Players within the online travel market are not only competing among
themselves, they are competing with the off-line travel channel,” said
Swerdlow. “Even though dollar
spending continues to grow, online travel players will not see significant
customer growth unless they create online product offerings that simplify the
purchasing process and exceed the value of traditional offerings.”
