Online penetration among world’s highest

Online penetration among world’s highest
By admin


The online travel market in Australia and New Zealand will continue to boom over the next few years with penetration among the highest in Asia Pacific and even the world, according to new research.

PhocusWright’s Australia and New Zealand Online Travel Overview showed gross online leisure and unmanaged business travel bookings in Australasia grew 13% in 2011, almost double the overall travel market’s growth of 7%.

The report predicted double digit growth would continue into 2013, despite the maturing of the online market, while the overall travel market continued to grow at almost half the pace.

Air dominates the landscape, accounting for 80% of total online sales. Online air gross bookings shot up nearly 30% in 2010 and 2011 to just short of $9.7 billion, with low cost carriers set to drive growth even further.

“As LCCs expand their networks and drive sales through online channels, air passenger revenues will be the fastest-growing online segment in ANZ, soaring to $11.8 billion by 2013 and representing half of all ANZ air sales,” the report said.

However, senior director research Douglas Quinby insisted huge opportunities for growth existed in the accommodation sector which currently accounts for 17% of total online sales.

“It is the more fragmented lodging and intermediary arenas that are really heating up,” he said.

While online hotel sales increased 22% to $2.1 billion in 2011, the report showed supply issues and a significant mix of offline bookings were hindering growth. The segment is expected to slow to single digits by 2013 when the total online hotel market will reach $2.6 billion.

Meanwhile, local online travel agents (OTA) faced increased competition from their global counterparts in 2011, with traditional travel agencies moving online also posing a growing threat.

“As growth slows – and it certainly is in mature online markets such as Australia and New Zealand – home-grown online and traditional agencies are stepping up the fight, as are some of the global OTAs,” Quinby said.

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