Suppliers vs. OTAs: An uneasy equilibrium
January 06, 2009 | Online Travel
As the online leisure/unmanaged business travel market in the U.S. has matured, supplier Web sites and online travel agencies (OTAs) appear to have reached relatively stable market share.
According to PhoCusWright’s Online Travel Overview Eighth Edition, supplier sites account for 61% of the online market vs. 39% for OTAs in 2008. This balance is projected to hold steady through 2010, although intense competition and tumultuous dynamics underlie this uneasy equilibrium.
From 20032006, a period of strong overall growth for travel and the online market in particular, suppliers aggressively grew their online share through relentless marketing and incentives to drive consumers to book direct on their Web sites. But as the economy began to sputter in the second half of 2007, consumer demand slackened and OTAs started to benefit from a limited countercyclical lift.
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