PhoCusWright Predicts Growing Share for Online Travel Market

The U.S. online leisure/unmanaged business travel market is significantly outperforming every other distribution channel in 2009, according to PhoCusWright, a travel industry research company.

PhoCusWright’s U.S. Online Travel Overview Ninth Edition projects that U.S. online leisure/unmanaged business bookings will decline 7 percent while the total U.S. travel market will post a 16 percent drop. The sharp fall-off in traveler demand and spend this year will reduce the size of the overall market to pre-2005 levels.

However, the pullback has not been as severe for Internet distribution channels, which have outshined other sectors in 2009. As a result, online travel’s share of the total travel market will surge from 35 percent in 2008 to 39 percent in 2009, with online travel agencies (OTAs) proving far more recession-resistant than supplier websites.

With 2009 coming to a close, all eyes are focused on the turnaround and outlook for 2010 and 2011. PhoCusWright projects very modest growth for the travel industry in 2010, but the outlook varies for travel segments and distribution channels.