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Online Travel Market

Travel Planning

Almost half of South East Asian travellers use online travel sites, women accounting for more at 57%, according to a poll commission by leading Asia/Pacific travel metasearch site, Wego that found that the demographic of South East Asians traveling is shifting, with the next generation effectively redefining the market. The study revealed that traditional group travel is in decline and Singaporean, Indonesian, Malaysian, Thai, Vietnamese and Filipino travellers now have a preference for travelling freely, and on a more individual basis.

When planning a holiday, South East Asian travellers get inspiration from:
– Family & Friends: 61%
– Travel Websites: 49%
– Newspapers & Magazines: 37%
– Search Engines: 36%
– TV: 27%
– Travel Blogs: 25%
– Travel Agency: 25%
– Facebook: 20%
– Tourism Board: 16%
– Twitter: 5%

South East Asian travellers conduct their holiday research through a combination of online and offline activities. While 21% conduct it all online, 38% conduct half online / half offline and 27% conducting more of it online.

The study also found that 58% access internet via mobile and 42% use mobile devices to research travel options. (HOTELMARKETING.COM, June 2012)

Travel Booking

Online gross travel bookings in the APAC region will grow twice as fast as the total travel market to comprise 25% of the total market by 2013, according to PhoCusWright PhoCusWright’s Asia Pacific Online Travel Overview Fifth Edition report.

Online travel agencies will be the fastest-growing online distribution channel, but the region’s local incumbents will face greater competition from global online agencies and supplier websites.

Asia Pacific continues to experience significant advancement in infrastructure, innovation and consumer appetite for travel, according to Douglas Quinby, PhoCusWright’s senior director, research. Despite concerns about slowing overall economic growth in China and India, travel in the region – and in particular online travel – continues to experience rapid growth and change.

APAC continues to be the fastest-growing travel region globally. China’s rising travel market will overtake Japan’s by 2013 as the region’s largest travel market. PhoCusWright projects high single-digit growth for the overall APAC travel market through 2013, when it will reach US$357 billion – a 64% increase over 2009. (PhoCusWright FYI, August 2012)

A massive influx of hotel supply and rapid changes in consumer behaviour are dramatically transforming the hotel landscape in Asia Pacific (APAC). The region’s maturing hotel market is growing rapidly and online bookings are soaring despite mounting concerns over an economic slowdown in key Asian markets such as China and India, according to the PhoCusWright’s Asia Pacific Online Travel Overview Fifth Edition: Hotels report.

APAC’s Long Tail of independent hotels is getting shorter as a robust pipeline among global, regional and local chains greatly expands branded and upscale hotel options in the region. Distribution dynamics are also shifting amid improving technology and infrastructure, as consumers embrace new ways to find and book hotels. PhoCusWright projects continued growth for the overall APAC hotel market and strong double-digit gains for the region’s online leisure/unmanaged business travel market through 2013, when online hotel penetration will reach 22%. (PhoCusWright, August 2012)

A massive influx of hotel supply and rapid changes in consumer behaviour are dramatically transforming the hotel landscape in Asia Pacific (APAC). The region’s maturing hotel market is growing rapidly and online bookings are soaring despite mounting concerns over an economic slowdown in key Asian markets such as China and India, according to PhoCusWright’s Asia Pacific Online Travel Overview Fifth Edition: Hotels.

PhoCusWright projects continued growth for the overall APAC hotel market and strong double-digit gains for the region’s online leisure/unmanaged business travel market through 2013, when online hotel penetration will reach 22%. (PhoCusWright, August 2012)

Asia-Pacific has already overtaken the US in terms of growth rates in online travel, according to PhoCusWright analyst Clement Wong at the WebinTravel conference in Singapore. In particular, and no surprise given the size of their respective populations, India and China are forecast to dominate growth in online travel over the course of the next few years.

PhoCusWright also estimates that in 2012, Europe will become the largest online travel sector, while Asia-Pacific will account for roughly 20% of the market worldwide.

Wong and others in Singapore signal a number of key factors driving growth:
– Growing middle class (with a desire to travel, especially overseas) in both India and China
– Rising adoption of credit and debit cards across the region, giving users easier means of securing travel products immediately over the web, although some countries still have widespread book online-pay offline policies in place.
– Similar to the spurts in growth in the west in the early to mid-2000s, rapid expansion of web connectivity in the home and businesses – alongside prolific use of mobile web.

Interestingly, according to Wong, car rental will form a significant part of the services in demand by travellers. (tnooz talking travel tech, October 2011)

The Asia Pacific region was the fastest growing travel market worldwide in 2010, according to a report by PhoCusWright. Gross travel bookings increased 17% to US$255.8 billion in 2010, compared to 2009, and far surpassed 2008 growth.

Several factors contributed to the growth, including an increase in disposable incomes, infrastructure development (including airports and hotels), growing demand for travel services, and access to the internet for online bookings.

Hotel room revenues in the Asia Pacific region recovered in 2010 after dropping 5% in 2009. In 2010, hotel bookings soared by 17% to reach US$84.1 billion, due to market rebound and local currency gains against the US dollar, according to the report. By 2012, the region will reach more than US$94 billion in hotel booking revenue.

China and India led the region’s growth in the overall travel market as well as in hotel bookings. (HOTELMARKETING.COM, June 2011)

The Asia Pacific online travel market has reached a tipping point. With the region’s online leisure/unmanaged business travel market surpassing 20% of the total market in 2010, online travel is no longer in its infancy. Double-digit growth is projected through 2012, and momentum is building.

For travel companies banking heavily on APAC’s online travel prospects, auspicious signs abound. Here are five reasons to count on robust growth in emerging markets, according to PhoCusWright.

– Emerging economic engines: The ascendance of powerful emerging markets is powering travel’s growth across the region. China and India bucked global recessionary trends in 2009 as their gross domestic products (GDPs) grew 9.1% and 5.7%*, respectively. Economic growth means rising disposable income and a growing middle class with an increasing demand for travel services.

– Fortuitous fragmentation: While branded hotel chains are investing heavily in APAC and account for a significant amount of the future pipeline, their share of supply remains small versus independents. Fragmentation beckons online intermediaries, signaling a major opportunity for the online channel.

– Low-cost carriers lead the way: Although traditional airlines continue to garner the lion’s share of APAC air bookings, low-cost carriers (LCCs) are steadily transforming the region’s air market – and luring travelers online. Air will be the fastest-growing travel segment across APAC through 2012, fueled by the rapidly expanding LCCs.


A diverse Asia Pacific (APAC) travel market is poised for significant online growth, according toPhoCusWright’s Asia Pacific Online Travel Overview Fourth Edition report. The region quickly rebounded following a resilient response to the global economic slowdown. While the European and US travel markets both declined 15% in 2009, APAC declined just 7%, with China and India growing slightly on local currency terms.

Rising internet access and an organic shift toward internet purchasing will help propel strong double-digit growth in APAC’s online leisure/unmanaged business market through 2012, when gross bookings will reach $70.6 billion, up from more than $53 billion in 2010.

Online travel penetration varies widely in the region. In more mature markets such as Japan and Australia/New Zealand, online penetration gains are slowing, while emerging online markets like India and China are now driving growth across the region. (PhoCusWright FYI, May 2011)

In the Asia Pacific region, low-cost airlines have generated significant audience growth over the past year as attractive offers and promotions have prompted more consumers – and especially younger travelers – to consider these airlines, according to comScore.

Malaysian discount airline Air Asia grew its audience by an impressive 1.2 million visitors in the past year to help maintain its lead as the top-visited low-cost airline site in the Asia Pacific region. Tiger Airways posted the strongest rate of growth, more than tripling its online traffic to 1.8 million visitors, while Malaysia’s Firefly and India’s Indigo posted strong growth rates of 89 percent and 70 percent, respectively. (comScore, April 2011)

The online travel booking market in Asia Pacific is expected to hit a value of US$51.6 billion in 2011 and will grow by 30 to 40% a year going forward, according to industry sources, like PhoCusWright and Expedia, that look at the online travel market in Australia, China, Japan, India, Indonesia, Malaysia, New Zealand, Singapore and Thailand.

Market players said this is in contrast to the more mature US market which is growing at 5% a year.  Singapore meanwhile, is expected to grow around 20% to reach a value of US$1.5 billion in the online travel market in 2011.

Daniel Lynn, Vice President and Managing Director of Expedia Asia Pacific indicated that they have seen that Asian consumers are increasingly looking to buy travel online. If you look at the overall percentage of travel that is bought online, in US its 40%, in Europe it can be 30%, in Asia Pacific…even in the most mature markets like Singapore – it is still in the 20, 25% range and in other markets its down to the single digit still. So there’s a huge amount of growth to happen.

Overall, sites like Expedia expects between 10 to 20% of their booking revenues to come from Asia Pacific over the next two years, up from 5% now. Expedia currently takes in US$24.3 billion in annual gross bookings.

Furthermore, experts said as broadband and credit card penetration increases in Asia, consumers will be more willing to spend online. And complementing that is the recent phenomenon of group buying sites like Groupon and These sites allow consumers to buy deals at a huge discount, and sometimes it include airfares and hotel stays.

Corporate travel is another area that is driving growth as well, experts said. This is because more executives are seen to be making their own bookings online for their corporate travel arrangements. And this will be led by Asia’s giants, India and China, which experts said will see growth of 35% in business travel volume in 2011. (eTN eTurboNews, February 2011)

Travel sites in the Asia-Pacific region are outpacing growth from the general internet audience by almost three to one, according to Joe Nguyen, vice president in South East Asia atComscore.  The total internet audience in the Asia-Pacific region increased by 7% from 477 million in 2009 to 511 million in 2010, but visits to travel sites jumped 19% from 108 million to 129 million.

The largest share of the growth in travel sites comes from online travel agents in Asia-Pacific, increasing by 30% from 40 million to 52 million over the same period.

In the airline sector, AirAsia leads the field with 3.5 million unique visitors a month in August 2010 (up 15% year on year). Tiger Airways, interestingly, has the largest growth amongst the top ten airlines with a 52% leap from 2009 to 2010 to 930,000 monthly unique visitors.

Developing markets in Asia have a low number of female users (India 30% and Indonesia 36%), but figures in other Asian markets are closer to those in the US and Europe, such as Malaysia (47%), Singapore (51%) and Japan (44%).

Among the over-45s, car rental is the rather curious winner as the most popular internet category, well ahead of ISP services, sports, politics and food and the leader in the travel sector. Airlines come in eighth position and hotels at 19. (tnooz – talking travel tech, October 2010)

Increasing numbers of corporate travel managers and buyers in the Asia-Pacific region are turning to online booking tools (OBTs) to drive savings, enhance effectiveness and improve compliance, according to a white paper from BCD Travel.

The white paper concludes that based on lessons learned in mature markets, including Europe and North America, corporate travel programs in APAC can use OBTs to reduce calls per transaction and reduce advance ticket prices, increase advance bookings and reduce after-hours calls.

For the white paper, the Association of Corporate Travel Executives (ACTE) in July conducted a survey of approximately 100 corporate travel managers and buyers with responsibility for APAC travel programs. The survey found that adoption of OBTs in APAC has reached a tipping point with nearly 45% of companies surveyed now using an OBT in at least one market.

Other key findings of the APAC travel manager survey include:

– Nearly 22% of the survey respondents said that online self-booking adoption rates have improved from 2009 to 2010.

– Use of smart phones and other mobile devices is growing at an enormous rate in the Asia-Pacific leisure market. Nearly 21% of the ACTE survey respondents said that more than 90% of their Asia-Pacific-based travellers now use smart phones or other Web-enabled hand held devices.

(Travel Industry Wire, September 2010)

Travel Industry Online Developments

In advance to the EyeforTravel’s Travel Distribution Summit Asia 2012, EyeForTravel  has identify the five hottest travel topics for 2012 and share insights from some of the event’s foremost speakers. Many of the biggest issues facing travel firms in all corners of the world are fairly similar but what differs is the level of development of individual markets and where consumers are at.

The Top 5 travel trends to affect the APAC region are:
1. The world is increasingly social and mobile (think smartphones, tablets, e-readers) and is inhabited by rising numbers of tech-savvy consumers. Social and mobile are not going away so now more than ever travel companies must keep pace
2. Understanding, influencing, differentiating and delighting a customer during all stages of the travel experience will be the key to survival
3. Travel search is becoming more complex and must increasingly focus on personalisation and socialisation
4. Domestic and international travel will continue to grow rapidly in APAC so understanding the consumer in these markets and innovating for a growing middle class will yield benefits
5. All businesses aim to thrive so revenue generation across all platforms will be an ongoing theme. And of course the inevitable return on investment question from social media and mobile efforts is not going away either.

(EyeForTravel, May 2012)

Unlike their counterparts in the West, Asian travellers continue to want the big attractions and the big sights. Chinese are the most likely to choose a destination based on its sightseeing potential. Based on a recent Amadeus study, Asian tourists will be very receptive to a different, more functional and less individually-tailored type of application that enhances their sightseeing experience while they are travelling.

Overwhelmingly, the most popular concept among Chinese travellers in the survey was “an application that overlays visual information about the physical world around you through your mobile device” (80% found it very or extremely appealing).

It’s hard to underestimate the potential of the Asian market. According to previous forecasts by Amadeus and Oxford Economics, Asian travellers will account for a third of travel spending by 2020 – up from 21% today. (HOTELMARKETING.COM, April 2012)



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