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US Travel Booking market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Travel Booking market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Definition

The Report covers the US travel booking industry related to how consumers book travel-related transportation, accommodations, and tours/activities; what drives their choice; and attitudes toward travel booking and innovations.

Booking methods covered include:

  • Direct with suppliers – Hotels, airlines, car rental agencies, and cruise lines
  • Online – Direct with suppliers and via OTAs
  • Offline – In person, via phone, and through travel agents
  • Third-party OTAs – Websites that aggregate supplier offerings in a marketplace and provide the means to book directly

What you need to know

The US travel industry looks rosy overall, with Mintel projecting a 4-5% annual increase in the booking industry alone through 2023, reaching revenues of $57.6 billion in the next five years. With vacationers spending more and looking for more experiential travel, booking providers are trying a variety of tactics in order to close the sale with the consumer. While OTAs (online travel agencies) dominate the landscape, other providers are finding their strengths and playing to them.

Expert analysis from a specialist in the field

Written by Mike Gallinari, a leading analyst in the Travel & Leisure sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The US travel industry looks rosy overall, with Mintel projecting a 4-5% annual increase in the booking industry alone through 2023, reaching revenues of $57.6 billion in the next five years. With vacationers spending more and looking for more experiential travel, booking providers are trying a variety of tactics in order to close the sale with the consumer. While OTAs (online travel agencies) dominate the landscape, other providers are finding their strengths and playing to them. Mike Gallinari
Travel & Leisure

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Overview
          • The issues
            • Move to experiential vacationing
              • Figure 1: OTA activities booking habits vs desires, February 2018
            • Sharing economy rising in popularity
              • Figure 2: Types of vacation lodging, all vacationers, February, 2018
            • Differentiation is a problem among OTAs
              • Figure 3: Average percentage point difference of not visited to visited, among Gen X, Baby Boomer, and WWII generations, February 2018
            • The opportunities
              • Travelers desire to have information centralized
                • Figure 4: Booking site feature importance, any and most important, February 2018
              • Bespoke travel services on the horizon
                • Consumers trust experience for planning
                  • Figure 5: Outlets for destination discovery, February 2018
                • What it means
                • The Market – What You Need to Know

                  • Travel booking market on track for 4-5% annual growth
                    • Travel industry expected to grow, despite bumps
                      • Americans feel good about their financial state
                        • Booking options have expanded
                          • Millennials are all grown up and having little Millennials… wait
                          • The Market

                            • Travel booking market continues to grow
                              • Figure 6: Travel arrangement and reservation services revenues and forecast, at current prices, 2013-23
                              • Figure 7: Travel arrangement and reservation services revenues and forecast, at current prices, 2013-23
                          • Market Breakdown

                            • Online booking is here to stay
                              • Figure 8: E-commerce share of total revenues of travel arrangement and reservation services, 2013-2018
                            • Direct providers and OTAs continue to fight
                              • OTAs approaching duopoly status
                                • Figure 9: Share of US bookings between top two OTAs, 2016-2017
                            • Market Factors

                              • Economic data
                                • GDP growth decline
                                  • Figure 10: GDP change from previous period, Q1 2007-Q1 2018
                                • Shrinking DPI gains
                                  • Figure 11: Disposable Personal Income change from previous period, January 2007-April 2018
                                • Consumer sentiment remains high
                                  • Figure 12: Consumer sentiment index, January 2007-May 2018
                                • Fuel prices fueling decline
                                  • Figure 13: US gasoline and diesel retail prices, January 2007-May 2018
                                • Net neutrality repeal
                                • Market Perspective

                                  • Millennials in the driver’s seat
                                    • Figure 14: Population by generation, 2018
                                  • Americans feel good about their finances…
                                    • Figure 15: Current financial situation, 2013-18
                                  • …and want to get out into the world
                                    • Figure 16: Where extra money is spent, February 2018
                                • Key Players – What You Need to Know

                                  • Direct platforms are at war with OTAs
                                    • OTAs focused on expansion
                                      • Airbnb is worrying everybody
                                        • Travel agents have a place in the market
                                        • Key Players

                                          • Booking Players Overview
                                            • Direct Platforms
                                              • OTAs
                                                • Expedia Group
                                                  • Booking Holdings
                                                      • Figure 17: Share of US bookings between top two OTAs, 2016-2017
                                                    • Metasearch
                                                      • TripAdvisor, Inc.
                                                        • Google
                                                          • Figure 18: Travel planning resources, February 2018
                                                        • Airbnb
                                                          • Travel agencies
                                                            • Figure 19: Travel agent usage, by age group, February 2018
                                                        • What’s Working?

                                                          • OTA email strategies
                                                            • Flagships lead the way
                                                              • Figure 20: Monthly email volume, February-April 2018
                                                            • Companies view weekends differently
                                                              • Figure 21: OTA email volume by day, in millions, February-April 2018
                                                            • Thursdays are a battleground
                                                              • Figure 22: Share of daily email sends, by day of the week, February-April 2018
                                                            • Travelocity and Orbitz have their day
                                                              • Figure 23: Read ratios of OTAs, by day of the week, February-April 2018
                                                            • Mobile booking reigns; mobile check-in grows
                                                              • OTA domination
                                                                • Hotels Fight Back
                                                                • What’s Struggling?

                                                                  • Loyalty
                                                                    • Figure 24: Q1 2018 Direct Mail Volume
                                                                  • Television not convincing targets
                                                                    • Figure 25: Average percentage point difference of not visited to visited, among Gen X, Baby Boomer, and WWII generations, February 2018
                                                                  • Sharing economy hurting car rentals
                                                                    • Travel hacks – the bad kind
                                                                      • Demand for a centralized service still unaddressed
                                                                      • What’s Next?

                                                                        • Airbnb doing it all
                                                                          • Exclu$ive cont€nt
                                                                            • More seamless hotel experiences
                                                                              • Independent apps look to disrupt the process
                                                                                • Multigenerational travel
                                                                                • The Consumer – What You Need to Know

                                                                                  • Travel booked in advanced, activities booked in the moment
                                                                                    • Personal recommendations matter most
                                                                                      • Experiences are key
                                                                                        • Tide coming back in on cruises
                                                                                          • Push men, support women
                                                                                            • Agents staking their claim
                                                                                              • Sharing isn’t just for vacation slides
                                                                                              • The Vacation Booking Process

                                                                                                • Consumers prefer online booking
                                                                                                  • Figure 26: Typical travel booking methods, online vs in-person – nets, February 2018
                                                                                                  • Figure 27: Online booking for airline tickets and rental cars, hotels/motels, and activities, by generation, February 2018
                                                                                                • Most booking done two to six months in advance
                                                                                                  • Figure 28: Booking lead times, February 2018
                                                                                                • Older generations cautious, younger generations spontaneous
                                                                                                  • Figure 29: Booking advance times, by reservation and generation, February 2018
                                                                                                • Booking sites are a one-stop shop and increasingly mobile
                                                                                                  • Figure 30: Research and booking platforms, desktop vs mobile website, by generation, February 2018
                                                                                                • Youth taking to the seas
                                                                                                  • Figure 31: Cruise booking, by generation, February 2018
                                                                                                  • Figure 32: Cruise booking, by age and income, February 2018
                                                                                                • Opportunity for providers to get ahead in cruise booking
                                                                                                  • Figure 33: Cruise booking, provider website vs booking site, by age, February 2018
                                                                                              • Rise in Activity Booking

                                                                                                • Goers are also doers
                                                                                                  • OTAs are coming up short
                                                                                                    • Figure 34: OTA activities booking habits vs desires, February 2018
                                                                                                  • Young travelers book activities through a provider, not an OTA
                                                                                                    • Figure 35: Activity booking behaviors, by generation, February 2018
                                                                                                  • Experiences worth the investment
                                                                                                    • Figure 36: Activity booking behaviors, by age and income, February 2018
                                                                                                • Deciding on a Destination

                                                                                                  • The personal is practical
                                                                                                    • Figure 37: Outlets for Destination discovery, February 2018
                                                                                                  • With age comes (listening to) experience
                                                                                                    • Figure 38: Sources of travel inspiration, by generation, February 2018
                                                                                                  • No research for old men
                                                                                                    • Figure 39: Sources of travel inspiration, men 55+ vs all, February 2018
                                                                                                  • The boys’ and girls’ clubs of young travel researchers
                                                                                                    • Figure 40: Destination discovery methods of 18-34 year olds, by gender, February 2018
                                                                                                • Desired Attributes of OTAs

                                                                                                  • Show me what you got
                                                                                                    • Figure 41: Desired features in a booking website, February 2018
                                                                                                  • iGens show interest in local and late night
                                                                                                    • Figure 42: Desired features in a booking website – activity recommendations, by generation, February 2018
                                                                                                  • Young women want to stay informed
                                                                                                    • Figure 43: Desired features in a booking website, by age and gender, February 2018
                                                                                                  • Bring it all together
                                                                                                    • Figure 44: Booking site feature importance, any and most important, February 2018
                                                                                                • Travel Booking Attitudes and Behaviors

                                                                                                  • Booking is fun, but not a hobby
                                                                                                    • Figure 45: Vacation planning opinions, any agree, by generation, February 2018
                                                                                                  • Older adults set it and forget it
                                                                                                    • Figure 46: Vacation planning online behaviors, by age, February 2018
                                                                                                    • Figure 47: Vacation planning opinions, any agree, age 55+ vs all respondents, February 2018
                                                                                                • The Role of Travel Agents

                                                                                                  • Travel agents still provide value
                                                                                                    • Figure 48: Travel agency usage, by generation, February 2018
                                                                                                  • Agents have a strong niche
                                                                                                    • Figure 49: Booking habits, OTA vs travel agent, February 2018
                                                                                                • Travel Booking and the Sharing Economy

                                                                                                  • Home shares make up a significant portion of vacation stays
                                                                                                    • Figure 50: Types of vacation lodging, all vacationers, February 2018
                                                                                                    • Figure 51: Travel preferences, February 2018
                                                                                                • Appendix – Data Sources and Abbreviations

                                                                                                  • Data Sources
                                                                                                    • Fan chart forecast
                                                                                                      • Consumer survey data
                                                                                                        • Direct marketing creative
                                                                                                          • Abbreviations and terms
                                                                                                            • Abbreviations
                                                                                                              • Terms
                                                                                                              • Appendix – The Market

                                                                                                                  • Figure 52: Total US sales and forecast of market, at inflation-adjusted prices, 2012-22