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Posted April 23, 2018

online travel booking

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In this second post looking in detail at the Mastercard and WEX 2018 Travel Trends report, we take a look at US travelers’ booking behavior and preferences. The survey of 1,500 American travelers ranging in age from 18 to 70, found that, typically, 67% of respondents book their travel online with 73% of Gen Z and 76% of Millennial travelers doing so. Even in the Baby Boomer age group, more than half book online.

The most influential factor in the choice of online booking channel was “ease of booking,” cited by 72% of travelers. It beat out offers and promotions, recommendations from family and friends, as well as payment options, ability to personalize travel packages and one-stop shopping. Results did vary to some extent by age group, but all, except Gen Z, ranked ease of booking number one. Gen Z gave recommendations their top vote (31% versus 22% for ease of booking).

As the report notes, “Relationships between travel companies, hotels, tour operators, payment providers, etc., need to be solid to ensure that travelers don’t sense any kinks in the system.”

Booking Begins With Looking

Before travelers start booking a get-away, they need ideas and information about where to go. The 2018 Travel Trends report states that, “Eighty-six percent of all travelers we talked to consult online travel sources…including destination review sites (73%), sites that offer package deals (39%), and social media (36%).” The role of review sites is echoed in other consumer surveys, including one that found 95% of consumers read reviews before booking.

Online Behavior Favors Direct & Offers Opportunities For OTAs

The survey findings reveal that 63% of US respondents book directly with airlines, 62% directly with hotels and 47% book with online travel agencies. Again, breaking it down by age, OTAs have a stronger presence with younger travelers, including 57% of Millennials who “regularly book” with OTAs—giving those platforms an opportunity to gain the top spot with this group, as well as the younger Gen Z group.

When looking specifically at OTAs, destination review sites and online packaged deals, travel was booked most often with OTAs: Gen Z was 44%, Millennials 76%, Gen X 65% and Boomers came in at 55%. For the youngest group, destination review sites, at 42%, were nearly even with OTAs, while the gap between these two means of online booking was considerably larger for the other three age groups.

Making It Easy Is Critical

Increasing the share of online bookings will depend on the all-important “ease” criteria. The 2018 Travel Trends report concludes, “OTAs that don’t take steps to make their booking process smooth and seamless will find that consumers will hesitate to book with them in the future.”

While the Mastercard and WEX survey focused on behavior and not devices, other research highlights how important it is to extend a seamless experience to mobile booking in order to capture a larger share of online bookings.

Phocuswright found that those who most frequently use mobile booking tools are the ones who travel the most. It makes sense, but the difference between this group and those who rarely travel is significant. For the seventh edition of their US Travelers Technology Survey, Phocuswright asked 1,880 US online travelers about “overnight leisure trips” in the past 12 months. They found that 16% of respondents who take one trip a year use mobile booking, while 56% of those taking three or more trips booked via mobile devices.

Ongoing Challenge of Attracting Online Travelers

Deloitte’s 2018 Travel and Hospitality Industry Outlook acknowledges that the online battle for customers will continue this year. “The perpetual tug-of-war between travel suppliers and online intermediaries may intensify throughout 2018, particularly in the hotel sector where the stakes are rising. Online hotel-booking growth continues to outpace offline—and online travel agencies (OTAs) continue to flex their strength in the space…OTAs are not just growing their customer reach, they are expanding their content ecosystems with additional segments such as private accommodations, tours and activities, restaurant reservations, and more.”

And the 2018 Travel Trends report suggests that a little healthy competition is good for everyone. “All travelers stand to benefit from this competition [direct booking and OTAs], securing better deals and continually improved booking experiences.”

Download the full 2018 Travel Trends Report

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David Craft

David Craft

With WEX since 2016, David looks after our travel customers. David joined WEX as a Solutions Engineer, having previously held accounting and system development roles at a travel customer of WEX – this experience provides David with a strong technical understanding of our virtual payments solution. David holds a Bachelor of Science degree from The University of Texas at Arlington and currently lives in Austin, TX.


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